Today’s Budget 2020 report sets out a plan to invest in research and development (R&D) and cutting-edge technologies. By driving technological change, the government plans to create high quality, highly paid jobs of the future and the Budget sets out plans to increase public R&D investment to £22 billion per year by 2024-25. It will invest that money in the people, ideas and industries that will cement the UK’s world-leading position in science and technologies ranging from nuclear fusion to electric vehicles and life sciences.
This landmark investment is the largest and fastest ever expansion in support of researchers and innovative businesses, taking direct support for R&D to 0.8% of GDP and placing the UK among the top quarter of OECD nations – ahead of the USA, Japan, France and China.
Achieving the government’s ambitions on R&D will require investment from the private sector. To boost that investment the government will increase the rate of R&D Tax Credits and consult on widening the definition of qualifying expenditure to include data and cloud computing. The rate of Research & Development Expenditure Credit will increase from 12% to 13%
In life sciences, the government will provide the British Business Bank with additional resources to launch a dedicated £200 million investment programme which is expected to enable £600 million of investment, helping to ensure the UK remains a world leader in life sciences innovation.
The budget 2020 report states that research and innovation lead to better products, services and processes. These drive growth and prosperity across the country, and generate ideas and tools to tackle global challenges such as climate change and an ageing population. That is why the government set the objective of increasing economy-wide investment in R&D to 2.4% of GDP by 2027, and why the Budget puts science, innovation and technology at the heart of the UK’s investment strategy.
If your business is undertaking research and development activities to drive innovation, whether that be researching or developing new products, processes, materials, devices or services, or working to improve existing ones, there is a range of R&D funding available.
R&D Tax Credits reward companies with a cash credit or corporation tax deduction by allowing them to recover their eligible research and development costs, whilst there is a wide range of Grant Funding competitions open to UK businesses to support innovation. Please feel free to contact us for more information on these.
The full Budget 2020 report can be accessed here.